#165 What I Learned from Jason Fried
What I learned from reading “Rework” by Jason Fried.
Today’s Chapter is based on the book “Rework” by Jason Fried.
Jason Fried is an entrepreneur, author, and software designer best known as the co-founder and CEO of 37signals, the company behind Basecamp and the email service HEY. He advocates for simple, focused software and calm, sustainable ways of working.
Here’s what I learned:
Don’t Wait, Just Start
“To me, ideas are worth nothing unless executed. They are just a multiplier. Execution is worth millions.”
— Steve Jobs
Jason Fried challenges the traditional notion of entrepreneurship by emphasizing that starting a business today a lot more accessible than ever before. He insists that with technology, there is a lower barrier of entry for people to launch ventures without the risks and resources it once required. This technological shift democratizes opportunity, making it possible for anyone with an idea to enter entrepreneurship.
On this, he writes, “There’s a new reality. Today anyone can be in business. Tools that used to be out of reach are now easily accessible. Technology that cost thousands is now just a few bucks or even free. One person can do the job of two or three or, in some cases, an entire department. Stuff that was impossible just a few years ago is simple today. You don’t have to work miserable 60/80/100-hour weeks to make it work. 10-40 hours a week is plenty. You don’t have to deplete your life savings or take on a boatload of risk. Starting a business on the side while keeping your day job can provide all the cash flow you need. You don’t even need an office. Today you can work from home or collaborate with people you’ve never met who live thousands of miles away.”
Fried’s own experience in entrepreneurship with 37signals (now Basecamp) exemplifies this. He started small, sharing office space and handling customer support himself. He argues against the misconception that you need a ton of capital to start your own business is false and this is especially true in service businesses such as consultants, software companies, wedding planers, graphic designers, etc. In fact, he writes that “If you’re running a business like that, avoid outside funding. In fact, no matter what kind of business you’re starting, take on as little outside cash as you can. Spending other people’s money may sound great, but there’s a noose attached.”
This is especially true considering that obtaining outside money often leads to unnecessary complexity. By staying lean, businesses retain control and avoid making decisions that are not cost controlled.
Furthermore, Jason Fried mentions that the easiest way to start is to make something you need and that you would want to use. He elaborates that if you believe a product is useful, there is certainly other people out there that think the same. Sure, the target addressable market may not be large, but if you are running on a low-cost, it doesn’t really matter.
“The easiest, most straightforward way to create a great product or service is to make something you want to use. That lets you design what you know—and you’ll figure out immediately whether or not what you’re making is any good.”
— Jason Fried
Plus, building what you want to use gives you an intuitive understanding of customers’ needs and makes the steady work of iteration more meaningful. As he once said, “Best of all, this “solve your own problem” approach lets you fall in love with what you’re making. You know the problem and the value of its solution intimately. There’s no substitute for that. After all, you’ll (hopefully) be working on this for years to come. Maybe even the rest of your life. It better be something you really care about.”
Finally, Fried stresses the concept that ideas alone are worthless without execution. He urges immediate action, even if imperfect, over endless planning. And so, he encourages us to start making our ideas into a product, but iterate and refine it along the way.
“Ideas are cheap and plentiful. The original pitch idea is such a small part of a business that it’s almost negligible. The real question is how well you execute.”
— Jason Fried
This reminds me of what we have learned from Michael Bloomberg who believed in the concept of “doers”, the lean and hungry ones are the ones that usually go the furthest and that achieve the most. As a matter of fact, Bloomberg mentions that while it is important to have a vision, it is dangerous to start second-guessing yourself by worrying too much about the details.
At Bloomberg, the strategy has always been to build the product first and the rest would take care of themselves. Of course, Bloomberg made mistakes along the way and the product would have to be improved on with the feedbacks received from their customers. However, while their competition were still planning on perfecting their product, they were already through rounds of testing and were about to release their tenth version.
“ It gets back to planning versus acting. We act from day one; others plan how to plan—for months.”
— Michael Bloomberg
This is exactly how Bloomberg obtained their first customer. While Merrill Lynch were in the planning to develop a similar product, Bloomberg was able to obtain the contract by guaranteeing that they would deliver a workable product before the estimated time of delivery provided by Merrill Lynch’s internal tech team. Furthermore, he promised that Bloomberg would only be paid until they were truly satisfied with their product.
While it does not seem like it on the surface, this agreement was extremely beneficial for Bloomberg as it would allow them to receive direct feedbacks from Merrill Lynch on how to improve their product. As Bloomberg would say, “At Bloomberg, a problem spurs a solution. That’s what makes us successful.”
If you ever had a business idea that you would like to execute, here’s Michael Bloomberg’s advice on how you should proceed:
Think and Write A Plan!
“Think logically and dispassionately about what you’d like to do. Work out all steps of the process—the entire what, when, where, why, and how. Then, sit down after you are absolutely positive you know it cold, and write it out. There’s an old saying, “If you can’t write it, you don’t know it.” Try it. The first paragraph invariably stops you short. “Now why did we want this particular thing?” you’ll find yourself asking. “Where did we think the resources would come from?” “And what makes us think others—the suppliers, the customers, the potential rivals—are going to cooperate?” On and on, you’ll find yourself asking the most basic questions you hadn’t focused on before taking pen to paper. As you discover you don’t know it all, force yourself to address the things you forgot, ignored, underestimated, or glossed over. Write them out for a doubting stranger who doesn’t come with unquestioned confidence in the project’s utility—and who, unlike your spouse, parent, sibling, or child, doesn’t have a vested interest in keeping you happy. Make sure your written description follows, from beginning to end, in a logical, complete, doable path.”
Tear It Down and Take Action!
“Then tear up the paper. That’s right, rip it up. You’ve done the analysis. You’ve found enough holes in the plan to drive your hoped-for Bentley automobile through repeatedly. You’ve planned for myriad what-if scenarios. You’ve presented your ideas to others. You’ve even mapped out the first few steps. But the real world throws curveballs and sliders every day, as well as the fastballs you practice against. You’ll inevitably face problems different from the ones you anticipated. Sometimes you’ll have to “zig” when the blueprint says “zag.” You don’t want a detailed, inflexible plan getting in the way when you have to respond instantly. By now, you either know what you can know—or you don’t and never will. As to the rest, take it as it comes.”
Sometimes Less Is More
“Given the choice of being the earliest, the largest or the best, always aims to be the best.”
— Lui Che-woo
Another big misconception Fried tries to break is the cultural obsession with bigness. He mentions that we have this tendency to believe that a successful business means more employees, more office space, more funding, and more hours. However, Fried argues that “Maybe the right size for your company is five people. Maybe it’s forty. Maybe it’s two hundred. Or maybe it’s just you and a laptop. Don’t make assumptions about how big you should be ahead of time. Grow slow and see what feels right —premature hiring is the death of many companies. And avoid huge growth spurts too—they can cause you to skip right over your appropriate size.”
As such, he mentions that it is not a must for a business to grow in size, but rather a choice. In fact, Fried argues that there are many reasons why a company should not be upsizing. One of these reasons is that a larger company creates bureaucracy which slows things down. Small companies are better at pivoting. Small companies can experiment. Small companies can actually get things done instead of holding meetings about holding meetings. When you’re small, you’re agile. When you’re small, every employee matters.
“Embrace the idea of having less mass. Right now, you’re the smallest, the leanest, and the fastest you’ll ever be. From here on out, you’ll start accumulating mass. And the more massive an object, the more energy required to change its direction. It’s as true in the business world as it is in the physical world.”
— Jason Fried
Furthermore, this concept of “Sometimes Less is More” can also be applied in product building. It is a lot easier to build a successful product by keeping it simple. Fried argues that it is better to build a half-product that works well than a full-product that doesn’t. He mentions that “You can turn a bunch of great ideas into a crappy product real fast by trying to do them all at once. You just can’t do everything you want to do and do it well. You have limited time, resources, ability, and focus. It’s hard enough to do one thing right. Trying to do ten things well at the same time? Forget about it. So sacrifice some of your darlings for the greater good. Cut your ambition in half. You’re better off with a kick-ass half than a half-assed whole.”
As such, he mentions that when we start anything new, we need to identify the epicenter. He writes that “There’s the stuff you could do, the stuff you want to do, and the stuff you have to do. The stuff you have to do is where you should begin. Start at the epicenter.” To identify the epicenter, he believes in asking the question “If I took this away, would what I’m selling still exist?” Always think about the big picture first, then you can work out on the details.
“When we start designing something, we sketch out ideas with a big, thick Sharpie marker, instead of a ballpoint pen. Why? Pen points are too fine. They’re too high-resolution. They encourage you to worry about things that you shouldn’t worry about yet, like perfecting the shading or whether to use a dotted or dashed line. You end up focusing on things that should still be out of focus. A Sharpie makes it impossible to drill down that deep. You can only draw shapes, lines, and boxes. That’s good. The big picture is all you should be worrying about in the beginning.”
— Jason Fried
Similarly, if you are facing a problem, often the solution is to trim things out rather than adding more things. Fried writes, “When things aren’t working, the natural inclination is to throw more at the problem. More people, time, and money. All that ends up doing is making the problem bigger. The right way to go is the opposite direction: Cut back. So do less. Your project won’t suffer nearly as much as you fear. In fact, there’s a good chance it’ll end up even better. You’ll be forced to make tough calls and sort out what truly matters.”
This principle can be illustrated beautifully through the lens of failing restaurants. Fried writes, “Watch chef Gordon Ramsay’s Kitchen Nightmares and you’ll see a pattern. The menus at failing restaurants offer too many dishes. The owners think making every dish under the sun will broaden the appeal of the restaurant. Instead it makes for crappy food (and creates inventory headaches). That’s why Ramsay’s first step is nearly always to trim the menu, usually from thirty- plus dishes to around ten. Think about that. Improving the current menu doesn’t come first. Trimming it down comes first. Then he polishes what’s left.”
This also works in terms of working hours. Fried’s experience at Basecamp in terms of working hours is extremely different compared to other start-up companies. He believes that workaholism is not only unnecessary but stupid. He explains that “Working more doesn’t mean you care more or get more done. It just means you work more. Workaholics wind up creating more problems than they solve. First off, working like that just isn’t sustainable over time. When the burnout crash comes—and it will—it’ll hit that much harder. Workaholics miss the point, too. They try to fix problems by throwing sheer hours at them. They try to make up for intellectual laziness with brute force. This results in inelegant solutions.”
We’ve all been conditioned to equate long hours with dedication. But Fried exposes this as intellectual laziness. The real genius isn’t grinding through the night; it’s finding the solution that requires one-tenth the effort. As a matter of fact, Fried argues that workaholism actually deters creativity as lack of sleep prevents thinking. He explains that “Creativity is one of the first things to go when you lose sleep. What distinguishes people who are ten times more effective than the norm is not that they work ten times as hard; it’s that they use their creativity to come up with solutions that require one- tenth of the effort. Without sleep, you stop coming up with those one- tenth solutions.”
“If all you do is work, you’re unlikely to have sound judgments. Your values and decision making wind up skewed. You stop being able to decide what’s worth extra effort and what’s not. And you wind up just plain tired. No one makes sharp decisions when tired. In the end, workaholics don’t actually accomplish more than nonworkaholics. They may claim to be perfectionists, but that just means they’re wasting time fixating on inconsequential details instead of moving on to the next task.”
— Jason Fried
As such, more hours doesn’t mean more results. More employees doesn’t mean more progress. More features doesn’t mean more value. Sometimes, the most powerful move is to embrace constraints and let them force you to be creative.
This reminds me of the Pareto Principle we have learned from Tom Monaghan, the founder of Domino’s who believed in the two following core business tenets:
Prepare pizzas with the freshest ingredients possible
Deliver pizzas to the customers within thirty minutes
To make sure to run a profitable business while still satisfying its promises to the customers, Tom Monaghan used the Pareto Principle, also known as the 80/20 rule. This principle explains that 80% of outcomes are the result of 20% of inputs. In Domino’s case, Monaghan quickly realized that even though he sold three different sizes of pizzas 80% of his sales came from 12-inches pizzas. Similarly, 90% of beverage sold were either Coke or Pepsi. He explains “In Ypsilanti, at least 80 percent of the orders from dorms were for twelve-inch pizzas. So why have any other size?“
This was a major revelation and breakthrough in Domino’s Pizza history. By doing so, the company was able to leverage its profits even further. It may seems counter intuitive that simplifying a business may increase its revenue, but here’s how Monaghan explains it:
“The main argument for having only twelve-inch pizzas was faster service. But quality would be improved, too. A pizza maker has to learn how to make each size pie. The twelve-incher is easier and larger ones are much harder. There would be fewer mistakes too both in taking orders and boxing them. With three sizes of pies and just two inches difference between them, it sometimes happened during a rush that a worker would ruin a large pie by trying to jam it into a medium size box. Then there were the saving we would make in purchasing. Having one size would cut our box inventory requirements by two-thirds.”
— Tom Monaghan
Learn From Successes, not Failures
“Success is not final, failure is not fatal: it is the courage to continue that counts.”
— Winston Churchill
One of Jason Fried’s most counterintuitive lessons is to prioritize learning from successes rather than from failures. Conventional wisdom believes that you can learn more from your mistakes than from your successes, but Fried argues that it often teaches only what to avoid, leaving you without any insights on what is needed to succeed. Successes, however, provide actionable blueprints, repeatable strategies that can build momentum and confidence.
Fried writes, “Another common misconception: You need to learn from your mistakes. What do you really learn from mistakes? You might learn what not to do again, but how valuable is that? You still don’t know what you should do next. Contrast that with learning from your successes. Success gives you real ammunition. When something succeeds, you know what worked—and you can do it again. And the next time, you’ll probably do it even better.”
He further explains that studies show clearly that repeat entrepreneurs who succeeded before have a higher odds of future wins whereas failed entrepreneurs don’t have a higher odds of success. He mentions that “A Harvard Business School study found already-successful entrepreneurs are far more likely to succeed again (the success rate for their future companies is 34 percent). But entrepreneurs whose companies failed the first time had almost the same follow-on success rate as people starting a company for the first time: just 23 percent.”
“That shouldn’t be a surprise: It’s exactly how nature works. Evolution doesn’t linger on past failures, it’s always building upon what worked. So should you.”|— Jason Fried
In Fried’s opinion, a common theme among successful entrepreneurs is that they are building something durable by focusing on what doesn’t change. He mentions that “The core of your business should be built around things that won’t change. Things that people are going to want today and ten years from now. Those are the things you should invest in. Amazon.com focuses on fast (or free) shipping, great selection, friendly return policies, and affordable prices. These things will always be in high demand.”
As such, Fried believes in ignoring the external noise and to keep focusing things that are permanent, things that will never go out of style. Similarly, he warns us to avoid focusing on the competition too much. If you focus too much on competitors, you don’t spend the time needed to improve on yourself.
“Your chances of coming up with something fresh go way down when you keep feeding your brain other people’s ideas. You become reactionary instead of visionary. You wind up offering your competitor’s products with a different coat of paint.”
— Jason Fried
This reminds me of Jeff Bezos’ concept of obsessing over the customers. As a matter of fact, rather than focusing on competitors, Bezos founded Amazon with the idea of making it Earth’s most customer-centric company in the world. This concept came to him through the mental model of inversion. As a matter of fact, he realised that: “under all kinds of regulatory frameworks that I can imagine, customers are still going to want low prices. They’re still going to want fast delivery. They’re still going to want big selection. These are so fundamental and what we do.” As such, by working backward, similar to Jason Fried, Bezos always required Amazon to acquire new competencies to fulfil these never-changing and permanent customers’ needs:
“In our retail business, we have strong conviction that customers value low prices, vast selection, and fast, convenient delivery and that these needs will remain stable over time. It is difficult for us to imagine that ten years from now, customers will want higher prices, less selection, or slower delivery. Our belief in the durability of these pillars is what gives us the confidence required to invest in strengthening them. We know that the energy we put in now will continue to pay dividends well into the future.”
— Jeff Bezos
To do so, Bezos mentions in his 1997 Letter to Shareholders that the company must focus relentlessly and passionately on the customers in what he calls “Obsess over Customers”. As such, Amazon has been primarily built on three pillars of customer experience:
Large Selection of Products
Convenience
Low Price
As such, it is important for the company to keep a consistent high standard and to be always looking for ways to strengthen the three pillars of customer experience. And, sometimes, this can be solved by thinking backward, instead of forward. For example, rather than thinking on ways to improve convenience and experience for customers, Bezos decided to eliminate the root causes of errors which led to the same effect he wanted. This is the power of inversion! As Charlie Munger once said, “all I want to know is where I’m going to die, so I’ll never go there.”
Finally, Bezos truly believes that a business model based on obsessive customer focus is one of the best ways of running a business. The main advantage of being customer focused is that instead of focusing on what competitors are doing, Amazon are purely focused on satisfying customers who are always dissatisfied. As such, they cannot rest on their laurels and need to perform consistently. As he once said, “you cannot rest on your laurels in this world. Customers won’t have it.”
“I constantly remind our employees to be afraid, to wake up every morning terrified. Not of our competition, but of our customers. Our customers have made our business what it is, they are the ones with whom we have a relationship, and they are the ones to whom we owe a great obligation. And we consider them to be loyal to us—right up until the second that someone else offers them a better service.”
— Jeff Bezos
Beyond the Book
Listen to "#54 Jason Fried: Doing the Enough Thing" by The Knowledge Project
Listen to "Jason Fried, 37signals (makers of Basecamp, HEY and ONCE)" by David Senra
If you are interested in having conversations with the eminent dead, consider trying my AI Chatbox prompted with highlights from over 100+ biographies I have read. Try it here.
If you enjoy reading my newsletter, please consider becoming a paid subscriber. You’ll be able to keep this newsletter going! Here’s what you get when you upgrade:
Voting on polls: you’ll get to vote on who I should write about next.
Requesting biographies: you can request a biography for me to read and write about next.
Supporting my next book purchase: all payments received will be used to purchase a new biography.